South Africa's Youth League Declares "Economic War" on White

[Chirios]

Idiot calls for nationalisation of South African Mines.

Quote:
By Marius Bosch

JOHANNESBURG (Reuters) - The firebrand leader of the youth wing of South Africa's ruling ANC declared "economic war" on whites on Saturday, making clear he had no intention of backing down from inflammatory rhetoric on the eve of a party disciplinary hearing.

Julius Malema, whose calls for the nationalisation of mines have unnerved investors in Africa's biggest economy, said he would not tone down his demands.

"We are declaring economic war," South Africa's SAPA news agency quoted Malema as telling hundreds of supporters in Johannesburg's Alexandra township. "We are going to reclaim what is ours from the white minority."

He was speaking a day before the resumption of an African National Congress disciplinary hearing into accusations he sowed dissent in the ANC and brought it into disrepute.

The proceedings are seen as a showdown between Malema and President Jacob Zuma -- who came to power with the backing of the ANC Youth League.

Malema's calls for the state to take over giant gold and platinum mines and white-owned farms have galvanised poor blacks, many of whom are impatient with a system that has left wealth concentrated in the hands of a white minority that imposed race-based rule until two decades ago.

Supporters of Malema and police clashed when his disciplinary hearing started on September 2.

The Youth League will organise a protest march to the Johannesburg Stock Exchange next month as part of programme of action against youth unemployment and to push for nationalisation, Malema said.

Malema urged his supporters to fight for "economic freedom".

"If we don't do it now, those who are unemployed will stay that way forever."

Unemployment is officially around 25 percent. Millions still live in squalid shack settlements clustered around big cities. Youth unemployment is about 50 percent, and a study by the South African Institute of Race Relations said about half of current 25- to 34-year-olds will never find work.

Malema, 30, seen as a potential future ANC leader, faces suspension from the party if found guilty in the disciplinary hearing. If he is exonerated, Zuma could be fighting for his political survival.

Zuma faces a major ANC meeting in late 2012 when the party that dominates the country's politics elects its leaders. He will be in a strong position for re-election if Malema is sidelined but could struggle if Malema stays in the ANC and supports Zuma's rivals for the top job.

[Bakustra]

Why is this idiotic, exactly? Zalema is calling for wealth redistribution. The only obvious difference between that and people here calling for better equality of wealth in the US is that wealth in South Africa is much more tied to race in the sense that the poor are majority black and the rich are majority white. So what exactly is the problem here?

[Chirios]

Why is this idiotic, exactly? Zalema is calling for wealth redistribution. The only obvious difference between that and people here calling for better equality of wealth in the US is that wealth in South Africa is much more tied to race in the sense that the poor are majority black and the rich are majority white. So what exactly is the problem here?

Because the people that will get the money aren't the black unemployed.

It's not like there are lots of black people in South Africa who have the necessary skills but white employers simply won't hire them. Sure there will be such cases, but they will be few and far between. The problem is that black people in South Africa are badly educated, often almost ridiculously so. This is true of most of Africa, it's not as bad in South Africa but it's still a huge problem. People lack basic skills, and lack the basic skills needed to teach them the basic skills.

Let's say you nationalise the mines, how will that improve job creation? You can't hire more people, that creates inefficiencies and distorts the market, you can appropriate some of the money but frankly South Africa's government is ridiculously corrupt and will pocket a large portion of it, who are you going to get to run it? The people with all the experience will just have had their mines stolen from them, not to mention that nationalisation will deter other investors from entering the country.

The problem with South Africa is a low skilled populace, nationalising the mines will not deal with persistent unemployment amongst the black population, all it will do is move money from the rich white few to the rich black few.

[Pelranius]

Considering how the black middle and upper class is dependent on the mines and foreign trade and investment in general running for their prosperity, they'll most likely side with the whites on this.

The times when a sufficiently large number of haves with the security forces on their side facing the multitudes of have nots generally turn out pretty, pretty badly for the nots.

[Nieztchean Uber-Amoeba]

Why is this idiotic, exactly? Zalema is calling for wealth redistribution. The only obvious difference between that and people here calling for better equality of wealth in the US is that wealth in South Africa is much more tied to race in the sense that the poor are majority black and the rich are majority white. So what exactly is the problem here?

Actually, it's completely different. Jews are on-average educated and wealthier-than-average, and Jewish people control financial, media, and political apparatuses far out of proportion to their population in the U.S. This does not equate to making economic war against Jews okay.

[Chirios]

Why is this idiotic, exactly? Zalema is calling for wealth redistribution. The only obvious difference between that and people here calling for better equality of wealth in the US is that wealth in South Africa is much more tied to race in the sense that the poor are majority black and the rich are majority white. So what exactly is the problem here?

Actually, it's completely different. Jews are on-average educated and wealthier-than-average, and Jewish people control financial, media, and political apparatuses far out of proportion to their population in the U.S. This does not equate to making economic war against Jews okay.

Not to mention that a significant part of the reason why South Africa has suffered persistent unemployment since the end of apartheid is due to failed economic and education policies.

[Guardsman Bass]

Why is this idiotic, exactly? Zalema is calling for wealth redistribution. The only obvious difference between that and people here calling for better equality of wealth in the US is that wealth in South Africa is much more tied to race in the sense that the poor are majority black and the rich are majority white. So what exactly is the problem here?

Malema wants to do something similar to what Mugabe did in Zimbabwe. Aside from nationalizing the mines*, he also wants to seize and distribute white-owned land and property without any form of compensation. It's a recipe for another big chunk of the white population leaving South Africa (taking human capital/business experience and money with them), and for investor flight at a time when South Africa needs investment.

* Simply nationalizing the mines wouldn't be surprising - it's been done in other countries. The South African government would get more revenue, but also likely a lot more corruption in the process.

[K. A. Pital]

Yeah, this sounds a lot like Mugabe-style black populism. Which hasn't been a huge success in Zimbabwe, you know.

[Xon]

It takes something to take a nation which used to export food goods, to a bulk importer of food goods with famine for the last couple of decades now.

[K. A. Pital]

It takes something to take a nation which used to export food goods, to a bulk importer of food goods with famine for the last couple of decades now.

You're speaking about Zimbabwe, certainly? South Africa had no famine - for all I know. I just said the likeness to Mugabe-style black populism is disturbing. It does not necessarily mean both are one and the same.

[Pelranius]

It takes something to take a nation which used to export food goods, to a bulk importer of food goods with famine for the last couple of decades now.

You're speaking about Zimbabwe, certainly? South Africa had no famine - for all I know. I just said the likeness to Mugabe-style black populism is disturbing. It does not necessarily mean both are one and the same.

Fortunately the black middle and upper classes, as well as the Coloureds and Asians have seen what Zimbabwe looks like and would most likely throw in their lots with the whites. That should mean that about 30 to 40% of South Africa's population (according to my calculations) will oppose nationalization and redistribution of property and will probably come out on top in the event of any bloodshed, but class warfare is certainly not terribly more palatable than a Zimbabwe style implosion.

[mopheme]

Hi, long time lurker and second time poster.

As a black South African, I feel that there is a couple of misconceptions that need to be clarified with regards to the issue of economic transformation which the debate around nationanilisation is a symptom of.

Since the late 90s, the South African government has enacted a number of legislations with the intention of achieving workplace transformation to reflect the country's demographics and open up economic opportunities for the previously oppressed segments of the populace that happen to be also the majority. On good faith, the government and on the principle of codetermination with white employers and labour unions, targets were set for transformation and economic empowerment.

At the end of last year there has been little to no change at top management positions and technical positions, not because of lack of skilled people but due to the culture and over representation of white women. I would advise those interested to google the report of the transformation commission to get a full picture of the sorry state of transformation in this country.

Black economic empowerment is also a joke as most of the people that make money out of these transactions are white owned companies such as the banks whereas the actual black people end up owning something like 9 percent as it is the case with the mining sector.

This reculcentrant behaviour by the white employers are in an economy that was built off the back of cheap black labour,that enabled the development of the mining and farming sectors.

It is against this background that there is impatience with the rate of economic transformation amongst the poor black, educated blacks and everyone in between. BTW half of those employed in South Africa earn less than US$ 400 per month, hardly middle class especially when taking into account the spatial settlement patterns developed under apartheid that resulted in blacks having to travel long distances to employment areas unlike in most countries.

I also strongly resent the statement that all black South Africans are poorly educated morons that run a corrupt Governmnt. I will admit there are problems with our education system however there have been enough individuals produced to run the commanding heights of our economy (e.g. the mobile communications company MTN).

[MarshalPurnell]

Concentration of wealth in the hands of a national minority has always been troublesome, not least for the minority. To some degree it is inevitable, particularly in South Africa where the white population has a drastically superior quality of life and education. The average white person in South Africa is much better suited for technical and leadership positions than the average black person due in large part to discreditable historical factors. Closing the gap must invariably require promoting qualified black personnel in preference to qualified white personnel, dedicated efforts to improve the quality of education for the majority population, and a corporate commitment to expanding opportunities for promotion from the lower levels of the business. Unsurprisingly corporations have very little incentive on their own to be good citizens; they exist to make money, and maintaining the status quo is much cheaper in terms of efficiency and effort than trying to change it. I also don't doubt there is still plenty of leftover racism also getting in the way.

The problem with a radical nationalization as pursued in Zimbabwe is, first and foremost, it didn't work in Zimbabwe. There is certainly a much larger class of educated, technically competent black managers than in Zimbabwe, but are there enough? And how would the markets react to such a course? Foreign investment would certainly dry up for fear it could be expropriated without compensation the next time an ANC government wants to appeal to its base. The white population would accelerate its emigration, leaving South Africa and taking with them still valuable skills and education. And let us be honest, the ANC itself is riddled with corruption, incompetence, and demagoguery. The odds of any nationalizations being tilted to favor politically connected cronies rather than people who have the skills to manage the business are rather frightful. At best one is likely to wind up with a class of black oligarchs, with an economy structured like that of modern Russia - at best. And it is not likely that the nationalizations would actually see a major lift in the living conditions of the majority of Black South Africans anyway, since the number of middle management and corporate executive positions is limited, and modern farming requires special skills not widely available among the general population.

I would think new laws mandating affirmative action and requiring set percentages of corporate boards and so on be allocated along racial lines would probably have the best effect. The corporations will then act to mitigate the potential damage by selecting and recruiting suitable black candidates and make efforts to develop talent so they can actually meet the new legally-required quotas. At the same time the government could embark on major efforts to improve the education of the majority. Unfortunately the above-mentioned corruption, incompetence, and cronyism among what amounts the Single Ruling Party is likely to get in the way of serious social renovation. Radical left-wing "transformation" is, though, as seen elsewhere, not a replacement for the slow building-up of a technically educated majority suitable for all levels of modern economic activity.

[Chirios]

I also strongly resent the statement that all black South Africans are poorly educated morons that run a corrupt Governmnt. I will admit there are problems with our education system however there have been enough individuals produced to run the commanding heights of our economy (e.g. the mobile communications company MTN).

1) There is corruption in the ANC, this is a well documented fact.

2) If you think there isn't a large skills gap in South Africa then you are demonstrably wrong. According to Brand South Africa, 65% of Whites have a high school or higher education, 40% of Indians have the same, 14% of blacks and 17% of coloureds.

Nobody's saying that black people can't do anything, nobody is saying that there isn't a residual after effect from apartheid which has resulted in a skewed society, I'm saying that calling for the nationalisation of mines, the appropriation of white owned farms as a way to overcome that is simply dumb, because it doesn't address any of the root issues.

And there aren't simply "some problems" with the education system, it's broken. Firstly not everyone is educated past primary school, which means you've got a country filled with people that have basic reading/ writing skill but every other skill is only at elementary levels; secondly amongst those who are, you've got a system that is geared towards producing middle managers. This isn't just true of SA, it's true of most of Southern Africa. In the beginning, South Africa needed middle managers to run the government, and it's education system was geared towards producing the kinds of people who would be useful for running a government. Now it's twenty years on, and you find that you have lots of people with MBA's and lawyers, but nobody who knows how to lay down electrical wiring. Why do you think that all these Chinese construction companies and electronics companies bring over their own workers from Asia?

As for companies like MTN, the MTN group operates in what, 12 countries continent wide? And continent wide MTN employes only 17,500 people. Yes, they make a lot of money, but producing more companies like MTN won't deal with unemployment. Neither will nationalising mines, or nationalising farms.

[Chirios]

Firstly not everyone is educated past primary school, which means you've got a country filled with people that have basic reading/ writing skill but every other skill is only at elementary levels;

Btw, yes, grade 9 is compulsory, but if you leave school at grade 9 you might as well leave school at grade 6, because you're qualified to do the exact same stuff.

[mopheme]

The average white person in South Africa is much better suited for technical and leadership positions than the average black person due in large part to discreditable historical factors.

No.Remeber there was already a pool of black professionals educated outside and inside the country when apartheid ended. What happened was the exclusion of blacks from the necessary exposure and mentoring that would have enabled them to quickly gain the requisite skills while the white graduates still benefitted from extensive old boys networks hell bent on preserving white economic privilage.

Unsurprisingly corporations have very little incentive on their own to be good citizens; they exist to make money, and maintaining the status quo is much cheaper in terms of efficiency and effort than trying to change it.

In South Africa however the status quo is unsustainable in the medium to long term. Besides, there was legislation drafted with targets that the corporations had to comply with instead they chose to play games

The problem with a radical nationalization as pursued in Zimbabwe is, first and foremost, it didn't work in Zimbabwe. There is certainly a much larger class of educated, technically competent black managers than in Zimbabwe, but are there enough?

Actually Zimbabwe had a lot of professionals most of which occupy some strategic positions in the South African public and private sector.

And how would the markets react to such a course? Foreign investment would certainly dry up for fear it could be expropriated without compensation the next time an ANC government wants to appeal to its base. The white population would accelerate its emigration, leaving South Africa and taking with them still valuable skills and education. And let us be honest, the ANC itself is riddled with corruption, incompetence, and demagoguery. The odds of any nationalizations being tilted to favor politically connected cronies rather than people who have the skills to manage the business are rather frightful. At best one is likely to wind up with a class of black oligarchs, with an economy structured like that of modern Russia - at best. And it is not likely that the nationalizations would actually see a major lift in the living conditions of the majority of Black South Africans anyway, since the number of middle management and corporate executive positions is limited, and modern farming requires special skills not widely available among the general population.

I do not know enough about nationalisation to make a call about it however the call is not just limited to mining but also linked to supplying these raw materials to downstream industries to create more jobs. Currently these mining companies just want to export as much as possible and leave us with holes in the ground like Kimberley and massive unemployment.

[Chirios]

No.Remeber there was already a pool of black professionals educated outside and inside the country when apartheid ended. What happened was the exclusion of blacks from the necessary exposure and mentoring that would have enabled them to quickly gain the requisite skills while the white graduates still benefitted from extensive old boys networks hell bent on preserving white economic privilage.

No, there wasn't. Low levels of literacy were the norm amongst blacks in apartheid South Africa, directly as a result of apartheid politics. Those who had gone to foreign universities were generally trained in law, or politics. You're right about the white graduates benefitting from the extensive old boys networks, but you forget that most of the rich white people were involved either in the farming sector, or in the mining sector. Farming is labour intensive, but unless you rely on ridiculously inefficient farming methods is not a particularly high employment sector, meaning that while it's true that black graduates should've been hired more, their being so would not have had that great an effect on unemployment. As for mining, mining is labour intensive, but we can assume that the miners are hired on the basis of need rather than on race, simply because of population dynamics. Once again, hiring black graduates would've made a few more black people richer, but it would've done bugger all for unemployment in general.

In South Africa however the status quo is unsustainable in the medium to long term. Besides, there was legislation drafted with targets that the corporations had to comply with instead they chose to play games

And? The same is true of any international corporation, people prefer what they know, and in a market as unstable as the African one an American or European company will want to transfer the guy from America who has been running the Seattle branch succesfully for ten years rather than hiring a random person they barely know off the street. Again, you're right that these corporations need to hire more black middle managers, but that won't deal with persistent high unemployment which is the source of the unsustainable status quo.

Actually Zimbabwe had a lot of professionals most of which occupy some strategic positions in the South African public and private sector.

And many more stand around on street corners looking for work, trying to walk to peoples houses to clean. Once again, because there is a dearth of low skilled jobs.

I do not know enough about nationalisation to make a call about it however the call is not just limited to mining but also linked to supplying these raw materials to downstream industries to create more jobs. Currently these mining companies just want to export as much as possible and leave us with holes in the ground like Kimberley and massive unemployment.

They want to export as much as possible because exporting to China or Europe or America is where the money is. There simply isn't any money in delivering these raw materials to South African industries, which is why the government needs to focus on building the skills and experience needed to convert: "we mine Zirconium" into: "we build turbines".

There are several ways they can do this. Nationalisation is not one of them.

[Xon]

It takes something to take a nation which used to export food goods, to a bulk importer of food goods with famine for the last couple of decades now.

You're speaking about Zimbabwe, certainly? South Africa had no famine - for all I know. I just said the likeness to Mugabe-style black populism is disturbing. It does not necessarily mean both are one and the same.

Oh, very true.

The most successful nationalizations are when the government restructures a company to get rid of waste or to get the company todo something which it wasn't doing before. Any employment is an incidental side effect of the government making the company actually work as desired and still being capable of functioning.

Just making them hire more people and diverting revenue due to dodgy politics isn't a particularly sound business strategy.

[The Big I]

Hi, long time lurker and second time poster.

As a black South African, I feel that there is a couple of misconceptions that need to be clarified with regards to the issue of economic transformation which the debate around nationanilisation is a symptom of.

Since the late 90s, the South African government has enacted a number of legislations with the intention of achieving workplace transformation to reflect the country's demographics and open up economic opportunities for the previously oppressed segments of the populace that happen to be also the majority. On good faith, the government and on the principle of codetermination with white employers and labour unions, targets were set for transformation and economic empowerment.

At the end of last year there has been little to no change at top management positions and technical positions, not because of lack of skilled people but due to the culture and over representation of white women. I would advise those interested to google the report of the transformation commission to get a full picture of the sorry state of transformation in this country.

Black economic empowerment is also a joke as most of the people that make money out of these transactions are white owned companies such as the banks whereas the actual black people end up owning something like 9 percent as it is the case with the mining sector.

This reculcentrant behaviour by the white employers are in an economy that was built off the back of cheap black labour,that enabled the development of the mining and farming sectors.

It is against this background that there is impatience with the rate of economic transformation amongst the poor black, educated blacks and everyone in between. BTW half of those employed in South Africa earn less than US$ 400 per month, hardly middle class especially when taking into account the spatial settlement patterns developed under apartheid that resulted in blacks having to travel long distances to employment areas unlike in most countries.

I also strongly resent the statement that all black South Africans are poorly educated morons that run a corrupt Governmnt. I will admit there are problems with our education system however there have been enough individuals produced to run the commanding heights of our economy (e.g. the mobile communications company MTN).

Out of curiousity what i the unemployment rate of educated black South Africans? From memory when I worked for Harmony gold Australia they had a large representation of highly educated balck South Africans on their board.

[Chirios]

Out of curiousity what i the unemployment rate of educated black South Africans? From memory when I worked for Harmony gold Australia they had a large representation of highly educated balck South Africans on their board.

According to the University of Cape Town's Economics department: black people with tertiary qualifications make up <3% of the unemployed; people who are "matriculants" (high school graduates) make up 26% of the unemployed, and people who haven't finished high school make up 71% of the unemployed.

But, if you actually read the report, you find that amongst those who have the tertiary qualifications, many don't have the required degrees that South Africa needs.

[The Duchess of Zeon]

A rational system of wealth redistribution involves imposing high taxes on these businesses and using it to fund education, healthcare and housing needs for the black poor. That is the form of wealth redistribution which both works and is legal and equitable in society. This goon wants to simply seize the facilities. Then all of the skilled workers leave for other countries, investment ceases, and you have Zimbabwe Mk.2. There is nothing wrong with wealth redistribution, what is wrong is the moronic way he wants to go about it. The way to correct for apartheid is to put high taxes on white owned businesses, not to seize property from whites. The later is directly counterproductive toward any kind of multiethnic society existing in South Africa. Making the rich pay for young blacks to get a free college education at an institution their taxes also fund to world class standards is not. But this would require the ANC to take some responsibility and be honest about the direction of the country.